BBC suspends CTO after £100m is WASTED on doomed IT system

The BBC has suspended its chief technology officer on full pay - after it spunked almost £100m on a "tapeless" digital content management system that didn't deliver.

The £98.4m figure attributed to the failed Digital Media Initiative (DMI) may be a conservative estimate: the BBC Trust has commissioned an external technical inquiry into the fiasco, to discover how it happened and how much it really cost licence-fee payers. The trust has also axed the initiative.

The Beeb confirmed to The Register that CTO John Linwood, who was paid £287,800 last year, has been suspended on full wages. “Technology controller” Peter Coles will take over as acting chief technology officer and report to BBC operations director Dominic Coles.

BBC Director General Tony Hall said that DMI had "wasted a huge amount of Licence Fee payers’ money and I saw no reason to allow that to continue". Continuing DMI, wrote BBC Trustee Anthony Fry in a letter to Parliament's influential Public Accounts Committee, would be "throwing good money after bad".

"The industry has developed standardised off-the-shelf digital production tools that did not exist five years ago," explained Dominic Coles in a blog post. "The cost is so great because much of the software and hardware which has been developed would only have a value if the project was completed and we cannot continue to sanction any additional spending on this initiative."

In an internal email seen by The Register announcing the management change, Coles added:

"It’s important that we make sure that a project failure of this scale never happens again and I will continue to work with the [technology, delivery and archives] senior management group, together with and all our key stakeholders across the BBC through the Operations Board, to ensure that we have appropriate safeguards in place to avoid a similar situation in the future."

The BBC has an IT budget of £400m a year.

The DMI project has already been the subject of a critical National Audit Office report. The project began in 2004 and was then outsourced to Siemens - without an open procurement competition. Then Siemens IT Solutions and Services, the bit doing the work for the Beeb, was acquired by Atos, which continued to work for the broadcaster under contract. In 2009 DMI was then "reinsourced", or brought back in house in other words.

In 2011 the government's audit office reported that DMI was "not value for money". The auditors added:

“The BBC did not revisit the investment case at this point or test delivery options, such as finding a new contractor…. It told us this was largely because of the time a full EU public procurement would take and the potential impact of further delay on other time-critical BBC projects.”

But here we are. One question the BBC Trust should explore is why it took so long to kill DMI. Parts of the system have gone live, but the costs continued to escalate.

One source familiar with the project told the The Register that DMI was regarded as the “next big thing”:

"All of these grandiose schemes fail to account for the diverse cultures/requirements, in their original concepts. Eventually they realise this and become massive and unwieldy as they try to stretch the concepts into operations which have their own traditions as to how to deliver."

The BBC can deliver IT projects competitively. Before content management systems really existed, it developed one at a fraction of the cost of comparable private sector systems - a story we told here. At other times, IT projects resemble an open-ended job creation scheme.

Linwood's future is unclear - but senior editorial staff who found themselves sidelined have been simply been reassigned to new jobs. ®

Read the original BBC memo announcing the DMI system

Last week the BBC Trust approved funding for the Digital Media Initiative (DMI), the project which will enable the BBC to re–engineer its production process, removing tape from the equation and progressing towards a fully digital BBC.

This is a necessary modernisation and has been carefully developed with contributions from staff across all parts of the BBC.

The project is part of our five-year plan and was approved by the Trust after we had completed all the work needed to be sure this system is the right one to deliver the right outcomes for the BBC.

As you know, today, much of what we do is still on tape; shot on tape, moved around on tape, and stored on tape. This is costly and expensive to store, and makes it difficult to reuse content in new TV programmes. Storing content on tape also makes it harder to distribute over multiple platforms like interactive TV, web and mobile. DMI will bring a host of benefits including: easier editing, quicker access to material and your rushes will never be lost again.

DMI will eventually give us a BBC where we have an opportunity to shoot content on HD cameras straight to memory cards, with all the relevant meta–data that goes with it, (the who, what, where), which is captured too. It opens up a world of possibilities where our archived content could be available on the desktops of any member of BBC staff in any BBC office in any part of the world.

This will enable new services and expand opportunities for creativity which will become increasingly apparent by the day.

The implementation of DMI will have a carefully managed roll out over the next five years starting in Information & Archives, Sport, Natural History Unit, Children’s as well as other parts of Vision and Network Radio. DMI also delivers a considerable part of Salford’s core digital technology, making it an integral part of the Media City vision.

Finally, and most importantly, DMI is essential for the BBC to remain relevant to our ever evolving audience. Without DMI we simply can’t deliver many of our planned and exciting new on-demand services. We need to be able to remain ahead of, or at least keep pace with, the developments in the industry, while providing the innovation and quality content that our audiences expect from the BBC.